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Kroger to buy Albertsons?

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elsmere241:
https://www.cnbc.com/2022/10/13/shares-of-albertsons-jump-on-report-of-potential-merger-with-grocery-giant-kroger.html

Pink Jazz:
I wonder if they will be forced to divest Safeway as a condition of the merger.

SP Cook:
My guess is that the government will look at this one for a while.  The knee jerk reaction is to think the current crew hates “big companies”.  True or not, it loves it some Big Labor, and this creates a big unionized competitor to union free Wal-Mart.

If you look at a map of their operations, there are places where they overlap each other greatly and would have unacceptable market shares, and places where one or the other is unknown.  My guess is that they will have to sell of a list of stores in different places, leaving an (almost) truly national grocery chain for the first time in our history. 

The stock market play, as always in these deals, is to figure out who is going to be sold the overlapping stores, as these transactions are often for below value.  Ahold seems likely for some.  The other potential buyers aren’t stock companies.

WillWeaverRVA:

--- Quote from: SP Cook on October 14, 2022, 08:45:33 AM ---My guess is that the government will look at this one for a while.  The knee jerk reaction is to think the current crew hates “big companies”.  True or not, it loves it some Big Labor, and this creates a big unionized competitor to union free Wal-Mart.

If you look at a map of their operations, there are places where they overlap each other greatly and would have unacceptable market shares, and places where one or the other is unknown.  My guess is that they will have to sell of a list of stores in different places, leaving an (almost) truly national grocery chain for the first time in our history. 

The stock market play, as always in these deals, is to figure out who is going to be sold the overlapping stores, as these transactions are often for below value.  Ahold seems likely for some.  The other potential buyers aren’t stock companies.

--- End quote ---

The resulting merged company would be truly huge with over 5,000 locations, so I can't see Kroger keeping them all. I would imagine that the excess stores would be sold to regional chains, similar to what happened when Food Lion merged with Ahold - excess Food Lion and Martin's/Giant stores were sold to other chains, most notably Publix.

triplemultiplex:

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